Week in Review - August 19th, 2011

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↑ Consumer pricesCPI inflation edged back up in July, to 4.4%, remaining well above the Bank of England's 2% target. This prompted the Governor's seventh consecutive letter to the Chancellor of the Exchequer. The main upward pressure inflation was from financial services such as fees for arranging mortgages. Other upward pressure came from clothing and footwear; furniture, household equipment and maintenance; housing and household services. There was some downwards pressure, however, from food and drink prices.
↓ Labour market statisticsThe number of people in employment rose by 25,000 in the three months to June, but the ILO measure of unemployment rose by 38,000, meaning the unemployment rate went up to 7.9%. This was partially offset by a fall of 23,000 in the number of economically inactive people (those neither in work nor looking for work). The Claimant Count measure of unemployment – which records the number of people claiming Job Seekers' Allowance – rose again to 1.56 million in July, up 37,100 since June. This pushed the claimant count rate up to 4.9%.
↓ MPC minutesAlthough the MPC once again voted to maintain interest rates and quantitative easing at current levels, the two members of the committee who had previously voted to increase the base rate joined the majority in voting to keep it at 0.5%.
↔ Retail salesBetween July 2010 and July 2011 the volume of retail sales was unchanged though, by value, retails sales rose 4.3% over the same period.
↑ Public sector financesPublic sector net borrowing (excluding financial interventions) was £40.1bn in the year to date for 2011/12, down from £43.1bn in the same period last year. However, public sector net debt in July was equivalent to 62.4% of GDP compared with 55.4% of GDP in July 2010.
The week ahead
Fri 26th: Q2 GDP (second estimate); Index of Services; Q2 Business investment

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